The International Monetary Fund (IMF) has warned governments around the world that they will need to lift their countries’ pension age due to rising longevity. The news is very concerning to me, but not for the reason you may think.
According to the ASFA Retirement Standard, to maintain a modest lifestyle, an Australian single needs at least $841 per fortnight, while an Australian couple needs $1214. Current pension rates for singles are $756 per fortnight, a shortfall of $85 while couples receive $1139 per fortnight, a $75 shortfall. What is most concerning about these figures is that they assume the ‘retiree’ owns his or her own house. For those who do not, these gaps are even greater.
After paying a lifetime of taxes, largely missing out on the implementation of superannuation funds and having played a large part in making Australia the great country it is today, the current pension rates are a slap in the face to millions of Australians struggling on a less-than-modest income.
Having gone over the figures and breakdowns by the ASFA Retirement Standard, I then decided to write down my own list of weekly expenses to see how living on a pension would feel. While I expected that certain luxuries such as buying a few beers at the football would certainly have to be cut out of the budget, I was shocked by how much I would have to give up. It is clear to me, and to most pensioners, that there needs to be a serious government review into the current pension rates.
Where do you think funding cuts should be made to increase pension rates?
Read more about the ASFA Retirement Standard
Read what other members thought about the recent $6.70 fortnightly increase to the single Age Pension and $5.00 increase for each eligible member of a couple